Shaq Tells a Story

Today, I want to look at the data about Shaq. Data doesn’t lie, and I think it’s going to tell a grim story. I heard Awesemo use the phrase “toxic positivity” and I think it is a wonderful phrase. I see a lot of wishful thinking, a lot of “this is going to be the future” etc. But what I do not see with these sentiments is data, utility, market dynamics, etc to back up the positivity. Often, people say “you just gotta believe, man.” The problem with such phrases is that it’s platitudinous: belief devoid of rationality is not belief, it’s wishful thinking. “We gotta wish this into existence” is what people mean by this. Of course, we are formed to think that belief is contrary to reason when it is anything but, but that’s a philosophical discussion for another day.

As a small disclosure: at the time of this writing, I have 3 Shaq RIB moments that I purchased off the marketplace. It’s part of the reason I’ve noticed this. I do not say this to pump my bags at all. I’m saying this because of the experience of confusion that the data and pricing reveal to me.

One final, small note. People may see this data and see opportunity. This is fair. Maybe there is. A rational marketplace would allow for this to be an opportunity. But it is in my experience that the TopShot Marketplace is fundamentally irrational. That is a topic for another day perhaps. And it is my conviction that the irrationality is fueled by behaviour directly tied to how TopShot presents buying and selling as a feature through the MP UI. Economic fixes does not necessarily mean Dapper boosting the economy with fee forgiveness. Rather, I’m of the opinion one of the major reasons for decline is the very way the MP UI is structured. But, that’s for another day.

WARNING THIS IS A LONG ONE SO I’VE BROKEN IT DOWN AS BEST I CAN. There is a TLDR at the bottom if you’re looking for a quicker summary.

The Data

At the time of this writing (noon, PST, December 8th):

Low Ask: 1569
Unique Owners: 791
Total Owned: 887
Hidden in Packs: 103

Total Sales: 616 (Roughly 425 of which happened within first 3 days of drop)
Avg Sale for those 425: 3100ish (there were so many purchases that it was hard to find the avg price on the first three days, though I did manage to grab one of them, the first day :) ).
Total average of all 616 sales: 2675.18
Number of Resells: 82 (profit or loss)
Number currently for sale: 103

The question becomes, how is it that roughly 2/3 of total supply has sold, and yet the price is gone down half? Even if we take into account the resells (616–82=534), based on the fact that there are still 103 in packs, we are still at a rough 2/3 of total available moments have been sold on the MP. Let’s take a closer look at some of the data. One piece of data I would have loved to have found, but can’t find, is where the total number of listings lay on each day sales happen.

Resells

I did some grinding on the resells to get the data on who bought and flipped since the drop. As stated above, there are 82 resells. I’ve inputted it all into a spreadsheet and this is the information I got.

37 of the 82 sales were for a profit (after fees), the lowest being $5.00, the highest being $1721.10. (fun fact, fastest flip I saw was in 1 hour for $300!)

Out of all the 616 sales, Dapper received $82,395.40 from MP transactions. Overall Profit/Loss of all 82 resells is -7543.65 after fees. Those who bought on October 15th and sold within 3 days were the most likely to have profited, almost everyone who held beyond 3–4 days took a loss.

From the flipping perspective, outside the very small group who took a profit, the winner in the flipping game is Dapper. Though small potatoes, they took a total $10153.65 in MP Transaction fees. This is not pointing fingers, but what it does begin to paint is that in the current economy, it’s hard for anyone to get ahead.

The Other 534

This brings us to the other 534 that have been sold. I think this begins to tell a bit of the tale. Most people who are selling are those who originally pulled the Shaq. Paying the $169, a lot of people who have sold in the last 2 months are still in the black. This can be a key factor that continues to push prices down.

And yet here is where things get interesting. 68% of the sales happened within the first 72 hours. Only 32% have happened since then (again, a bit of an approximation, but should be sufficient for our exercise). Of those 534 (the pack pulled), then, 363 sold within first 72 hours. 25 of our 82 re-sells happened in the first 72 hours as well, for a total 388 sales in the first 72 hours, averaging at $3100 per sale. Of the 25 resells, 20 were sold for a profit, 5 for a loss, the biggest loss being 217.50, the biggest resell being 1721.10.

25 of the 37 for profit resells, then, happened in the first 72 hours, giving a larger proportion of the negative sales from previous purchases following afterwards. It becomes clear, people wanting to clear an item regardless of profit have been pushing the price more than those entering reselling.

What this means is that 228 moments sold since the initial rush have been determining the market price. Of those 228 moments, 171 are fresh pulls, 57 are resells. But this is where things get interesting. is it the fresh pulls that are putting the pressure on the lower end of pricing, or is it the resells? The next section proposes a surprise, counter-intuitive idea: it is the resellers who are pushing prices down.

The Current Listings

One of the most fascinating things for me to see was the current listings. As stated earlier, there are 103 listings: 40 under 3100, 39 between 3100 and 9999, and 24 that are listed at 10K+. Already, our supply should be discounted by 1/4, since most of those that are listed at 10K+ really are not realistic in the current market space.

For those listed under the initial average of 3100, 18 of them are previously purchased. Of the previously purchased, currently 9 are listed at a loss, 7 at a profit.

But for those listed at a loss, this is where things are upside down. Of the 10 lowest priced Shaq moments, 7/10 are previously purchased, listed at a loss. These people are competing to lose more money in sales, essentially. Those other 3 listed have no real loss to account for, and will probably leave their moment at the price listed.

For #11–20, none are listed at a loss, 3 are listed at a profit, 7 from packs

#21–30: 1 listed for profit, 1 for a slight loss, 8 from packs

#31–40: 3 listed for profit, 2 for loss, 5 from packs

What this does is it shows us something really interesting. Those who seem to be more active in the marketplace are the ones who seem to be more eager for a quicker sale, thus pushing pricing down. As you go higher up in the listings, the competition lessens.

For those listed above $3100 and below $10,000 (39 total), only 7 are previously purchased, meaning 32 people who pulled from packs are perfectly happy to leave their item at its current price. Of those 7 listed, all have listed for a profit from what they previously purchased it for.

This got me to ask the question: what do previous sales, lately, look like? I didn’t have the time to look at everything in the last month and a bit since the initial drop (maybe part 2), but thought December up to December 8th (time of writing) would be an interesting experiment.

The Degens Are Driving the Price

There have been a total of 17 sales in the month of December so far. Of those 17 sales, 10 are from previous purchases. Every single sale is at a loss. (Special Star if you notice a nefarious action in the chart!). 7/17 sales are from packs, so there is no loss taken. But this is disproportionate to initial activity. What we are seeing, though, is a pattern with current listing behaviour. Those who have previously purchased are more eager to sell than those who pulled the Shaq from a pack, at least at the current prices.

Since the Low Ask system is king for how TS does sales right now, the listing pressure is not coming from those who have them in packs, but from people who previously purchased these. The irony of course is that by doing so, they are in fact the cause of their own push downwards. Then they see the price go lower, and they list lower than that, fearing the price is going down (this is interpretive, obviously, but it seems logical). But the fact is, based on the above data, there is one class of people who are pushing prices downwards: those who are willing to take losses.

What does this all mean?

This whole bit will require a part two. I’m interested in finding out about listing dynamics here as well, as I think that has a role to play. I also would be interested in looking at the buying and selling history of some of these sellers to see if this is a common pattern of behaviour for them. I definitely want to do a deep dive on the odd sale on one particular moment that I mentioned above.

But, if I’m looking at this right, it seems to me pretty obvious: those who are pushing prices down tend to be more active on the platform and seem to be willing to take a loss at this time. Maybe they want to buy something else, maybe they want their money out. Sometimes — I know this is weird to say — maybe they want to actively chase a loss for some reason (sometimes nefarious, sometimes just a head scratcher).

The fact of the matter is, though, that those who are posting for sales right now have undo influence on the MP pricing for the Shaq. What’s more, based on the data, there seems to be a healthy confidence in his price at $3100. The number of sales in the first three days, and the less amount of sales since then (makes sense, most people got what they wanted those first three days), points to a strong confidence in initial pricing. The fact is, though, that the perceived value has gone down in half, even though only roughly 10% (7% if you take out the 10k plus listings) of the total supply is currently listed. There have been, this month, 17 sales on the Shaq (one a duplicate), removing 1.7% from the supply of listings for the time being. 2.1 sales a day. Pretty good, I’d say, for a high valued item.

But with prices being pushed down constantly, people are also afraid to buy. We do not really ever see any recovery, things only ever seem to go down. This makes buyers have reserve, causing people to panic, causing those who bought earlier to cut their losses. Those who got Shaq in a pack? They’re happy to wait it seems. It’s just $169, after all, for many, not going to break the bank.

Lindy, Give me the TLDR

Approximately 425 sold in the first three days for ~$3100.

The remaining 191 have sold since then. In that time, the price has dropped in half.

December sales shows that 10/17 are from previous purchases, and all were sold at a loss.

Currently there are 103 listings, 24 of which are listed at 10K+, making them outside the entire market pricing and ignorable. Reasonably, there’s 79 listings let’s say, 8.6% of total supply. Of those listings:

40 are $3100 and under

• Listings #1–10: 0 listed at profit, 7 listed at a loss, 3 from pack pulls
• Listings #11–20: 3 listed at profit, 0 at slight loss, 7from pack pulls
• Listings #21–30: 1 listed at profit, 1 at slight loss, 8 from pack pulls
• Listings #31–40: 3 listed at profit, 2 at a loss, 5 from pack pulls
• In total: 7 listed at profit, 11 listed at a loss, 23 from pack pulls

39 above $3100 and below $10,000

• 7 are previously purchased and listed for profit
• 32 pulled from packs
• 0 are listed at a loss

My interpretation of the data at this moment in time is simple: it becomes clear that lower prices are often pushed by those who are looking to sell fast. The problem is, this then supports those who pulled from a pack, are still at a profit, and so they support the push down. This is, again, in part to how TS has set up the MP UI. It becomes clear, too, that those who listed from pack pulls tend to be posting at higher prices. It is MP activity that is, ironically, pushing prices down.

That is where the irrationality really becomes clear as day. None of this should be happening, none of this makes sense, and most people who have bought are holding. The MP activity should be supporting those buying habits, but instead it’s supporting undercutting to a point of pushing prices so far down that it creates FUD. Everything in the data points not to prices going down, but prices should be going up. Less stock is available, not more!

There’s more to say about this, but the data is clear. This pricing makes really no sense at all. While it is understandable that perhaps less interest happens as people solidify their position. Less buyer interest is absolutely clear here. However, there’s also significantly less supply. Seeing where the pressure points are and where the selling pressure is coming from, it is clear that the more active MP users are pushing pricing down. Is this intentional? No. I think this has a lot to do with UI mechanics. This will lead to part 2, because this has gone longer than I thought, and I’ve got more to say. I’m also going to do some more data diving when the time allows to back up my point.

Finally, if you’re good at extracting data from the blockchain, I would love to hear from you about the listing/de-listing around this item. I would not be surprised if that tells us something, too.

-Lindyholic